"Rational expectations by itself seems to me separable from the assumption of price-cleared markets. It could be used in a model in which quantity adjustments were helping to equate supply and demand. Lucas himself says that he adopts the market clearing assumption because it is convenient, not because it is realistic. [...] The new classicals will also say that if you observe long-term contracts, which on the surface seem to depart from market clearing prices, you can simply reinterpret what market clearing prices are. You reinterpret the demand and supply functions under the constraint of the contracts. But then, they are not able to maintain the strong propositions that they were able to derive from their other models, notably about policy-ineffectiveness."